Here’s How Divorce Impacts Your Taxes

Many taxpayers contend with the issue of claiming dependents on their taxes after divorce. Because claiming dependents comes with a tax exemption and other benefits — including the head of household filing status, an earned income credit and a tax credit for the child — divorced couples might find themselves arguing over who gets to claim the child on taxes.

In these situations, only one person can claim a child as a tax dependent, per federal regulations. This means that one parent will reap the tax rewards and the other will get no tax benefit.

Claiming a Child on Taxes When You’re Divorced or Separated

Knowing who claims the child on taxes with joint custody in effect might be a bit more confusing than sole-custody situations. If your divorce allows for joint custody and long-term vacation visits, you need to understand which parent has primary custody. Here’s more information on filing taxes after divorce:

Claiming Dependents Under Joint Custody

If the terms of the divorce clearly identify a custodial parent — the parent who has primary custody of the child — that parent is legally entitled to claim the child as a dependent if the child passes some qualifying tests.

Many parents have 50-50 custody agreements but don’t have a written agreement regarding who can claim the child or children on their taxes. Whether you have primary custody or joint custody of a child after divorce, the fact remains that only one person can claim the child or children on each year’s tax forms.

A common remedy for an exemption tug-of-war is for parents to alternate years when claiming a child or children so they each get the tax benefits every other year. If you have more than one child and are wondering how many kids you can claim on your taxes, you can divvy up the responsibility and split your dependents between you. For example, if you have four children, every year you can select the same two children to claim. Tax deductions and credits will be easier to figure out this way, and you can avoid any mix-ups because you’ll do the same thing every year.

IRS Dependent Rules

In addition to knowing whether you can make a tax claim your child, you and your child will need to pass these IRS tests to make sure you qualify as far as the IRS is concerned:

Relationship: The dependent must be your son, daughter, foster child, descendants such as a grandchild, brother, sister, step-sibling or extended descendant, such as a nephew.

Age: The child must have been under 19 years old and younger than you or have been under 24 years old, a full-time student and younger than you in 2017. You can claim a child who was permanently and totally disabled in 2017, regardless of age.

Residency: The child must have lived with you more than 50 percent of the year.

Support: The child must not have provided more than 50 percent of his own support over the year.

Family Income: The child tax credit is reduced if your modified adjusted gross income is above a certain amount. The child tax credit phase-out threshold is $55,000 for married couples filing separately; $75,000 for single, head of household, and qualifying widow or widower filers; and $110,000 for married couples filing jointly. For each $1,000 of income above the threshold, your available child tax credit is reduced by $50.

The IRS can serve as a guide for claiming children on taxes. In many cases, however, the delineation isn’t so clear — especially in the case of shared custody.

Child Tax Exemption

Often, a state divorce court will order that the custodial parent gives the dependency exemption to the noncustodial parent, but ultimately federal law determines who claims a dependency exemption. IRS rules state that to give up the dependency exemption, the custodial parent must sign a “release of exemption” claim, or IRS Form 8332, and attach that form to the tax return. Once that child tax credit form is filed, the custodial parent can’t claim the child tax credit for that child.

When you address the issue of claiming children on taxes, it’s important to research your rights and make your claim correctly. Getting over the hurdle of a divorce and determining dependency exemptions is challenging enough, so don’t invite further hardships by risking a tax audit.

My husband and I are still married. We have 2 daughters on 2011 taxes we could only file with our youngest child because someone else claimed our oldest one? Dont know how thats possible but liberty tax in ohio said they would file for my other child once we brought in verification of birth records, ssn, schhol records, we did that and no return yet. Its now getting 2012 taxes and when I call liberty tax in ohio, the manager is always with a client and will call me back..lol just want to know how I can find out if they filed our daughter, we are now stationed in cali. So only form of contact is byy phone.

Liberty Tax Corporate

Lisa- Please contact Liberty Tax Customer Care at 800-790-3863

Bethany

When my ex husband and I got divorced, my 2 children and I were legal residents of California and my ex a legal resident of another state. Since our divorce took place in the other state, that state had no jurisdiction to give either sides any type of custody rights. I only became the sole decision maker for the children. Through the divorce process the judge set it in our divorce documents for each of us to claim a child on our taxes every year. Both of my children are with me about 80% of the year. Is he still able to legally claim one of my children even though they live with me all year?

help a mom

I have 50 custody of my son but the father has him a bit more throughout the year. I want to claim my child but he wont let me. He said his mom will claim our son. He doesnt have a job. Would this help me get the upper hand?

susan

if the decree has one claiming custody in alternating years does the first year, 2013, count as the odd year?

brian

If decree claims alternating years, does mother have the right to change this without going to court? She had son 2 more nights in 2013 than I did. She wants to claim him from here on out even though court document states otherwise.

Amanda

It is my ex’s year to claim daughter, is it legal for his girlfriend to claim my child? He has worked all year, they were not married and the only reason he didn’t want to claim is because he’s so far behind in child support.

Heather

Absolutely not. A lot of the time, the divorce papers also have a condition that the parent being current in child support in order to take the child tax credit. If she is planning to file your daughter for sure, I would file yourself (especially if the divorce papers have that child support contingency) because the girlfriend does not meet the qualifications.

Lara Smith

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hmm After six years in marriage with my husband with 3 kids, he suddenly started going out with other women and coming home late, each time i confronted him it turns out to be a fight and he always threatened to divorce me at all time, my marriage was gradually coming to an end. i tried all i could to stop him from this unruly attitude but all proved abortive, until i saw a post in the forum about a spell caster who helps people cast spell on marriage and relationship problems, at first i doubted it but decided to give it a try, when i contacted this Spell caster Dr. Dangogo via email, he helped me cast a spell and within 4 hours my husband came back apologizing for all he has done and promised never to do such again and today we are happily together again. Contact this Great spell caster for your marriage or relationship issues via this email; dr.dangogospell@gmail.com

sondra

I live in a different state and my ex claims both children. I want to claim one child
. Do I have to get it added in the custody agreement? I pay child support plus other expenses.

Tonya Lane

I wanna know since i work from home as a daycare provider and my husband outside the home can he claim the children and then I file them

Sarah

My son’s dad wants to claim our son every other year. He pays 20% of his income to me each month and sees our son the days he is supposed to. He’s very good about seeing him and paying. He seeing him less then 50% of the year and when it comes to financially supporting our son on his time he pays for food and diapers but clothing, bottles, etc are mostly from me. Me being the residential parent I’m wondering if it’s worth going through court to try and be able to claim him yearly or if I should just save the trouble and money and let him switch each year.

Lindsey F.

My son is only a year and a half years old. I was never married but me and his father have recently split up. I get the baby more than 50% of the time, his dad only gets him weekends. We both work and even though his dad works more than me and makes more than I do, I signed that form last year to let him claim our son. For the 2014 tax season, I want to claim our baby. Last year, he spent over half of that tax money on toys for himself, he saved some but blew through it during the summer. All that money didn’t even go towards anything for our family. He was selfish and very irresponsible with it. At least, when I’d get to claim the baby and get my tax returns, I would save a lot of it and use it wisely. And actually since we have split, we haven’t really come to an agreement or filed child support (yet?) It’s been a bad situation. Would I be able to claim the baby?? I’m going to school full time online for college (2nd year) and the money could help me and my son out so much!!! I just don’t know what to do! I file my taxes really fast, get my W2 and get them sent off very early in the tax game, and get it direct deposited into my bank account so I’m like tax – return – savy.

fea

my ex and I broke up we where together for two years he claimed my kids year before but I claimed them this year. they are not his kids no legal or genetic bind. in Missouri can he legally fight it if I already claimed them

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CMeadows

My e-file was rejected this year because someone claimed my granddaughter. We have had custody of our granddaughter since July, 2012 and claimed her the past couple years with no problems. Now it’s a problem, I have sent in a paper copy as directed by my tax preparer. Do either parent have a right to the dependent exemption credit even though, she lives with us and neither parent has her more than an occasional visit.

ed

my kids are coming next year from philippines. After i will get their social security numbers, could i claim them as my dependent even they are not here in 2015?

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